grace period

noun

: a period of time beyond a due date during which a financial obligation may be met without penalty or cancellation

Examples of grace period in a Sentence

The terms of the loan allow for a ten-day grace period.

Recent Examples on the Web

Another 12 states – including California, Florida and New York – and the District of Columbia have similar grace periods ranging from one to 10 days for absentee ballots. —Bart Jansen, USA TODAY, 7 Oct. 2024

The Education Department implemented this grace period to ease the borrower’s transition to make payments after a three-year payment pause during the COVID-19 pandemic. —Adriana Morga, Los Angeles Times, 6 Oct. 2024

This grace period applies to all federal student loans and some private loans. —Nerdwallet, The Mercury News, 16 Sep. 2024

Standout benefits: LendingClub offers a 15-day grace period to make payments to avoid any penalty fees. —Ryley Amond, CNBC, 27 Sep. 2024

Word History

First Known Use

1907, in the meaning defined above

Legal Definition

grace period

noun

grace pe·​ri·​od

: a period of time beyond a scheduled date during which a required action (as payment of an obligation) may be taken without incurring the ordinarily resulting adverse consequences (as penalty or cancellation): as

a

: a period of 30 days or one month during which premiums on insurance policies may be paid without penalty

b

: a period of ten days during which certain security interests (as those in fixtures) must be perfected in order to have priority over conflicting security interests under Article 9 of the Uniform Commercial Code

called also days of grace